Q&As

Can a remedy be obtained against a company director of a personal service company (of which the director is the single director) who has been overpaid? The company acknowledge is not entitled to the money paid in error and began repayments in instalments, but subsequently stopped them and are not responding to any communication. A third party debt order has been applied for, but the bank states there are no funds in the company’s business account.

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Produced in partnership with Ryan Hocking of Gatehouse Chambers
Published on: 19 August 2020
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The underlying question in this Q&A is—who is the proper defendant to the claim? The claim would appear to be one in unjust enrichment, with the unjust factor being a mistake. Given that the payment was made to the company, it is the company who was enriched, and against whom the claim lies. The fact that the director may have extracted the Money from the company is unlikely to be sufficient to ground an unjust enrichment claim against the director.

Ordinarily, directors (or shareholders, in the case of Salomon v Salomon [1896] UKHL 1 (not reported by LexisNexis®)) will not be liable

Ryan Hocking
Ryan Hocking

Ryan has a busy, broad-based commercial and insolvency practice. He is a sought-after trial and appellate advocate, having acted in a number of cases of wider commercial significance to the client. Ryan's insolvency practice includes both personal and corporate insolvency, acting for office-holders as well as individuals and directors. He advises and acts in respect of (amongst other things) antecedent transactions, misfeasance, and litigation brought by office-holders. Within the wide category of commercial litigation, he has experience in matters relating to contractual disputes, civil fraud, partnerships and LLPs, professional negligence, financial regulation, unjust enrichment, and of cases with an international dimension (including injunctive relief and cross-border insolvencies). Ryan welcomes instructions to act as sole counsel or as part of a team, and has been led in the High Court (for example, being led by Brie Stevens-Hoare QC in the commercial fraud case of Chowdhary Ltd v Tossed & McKevitt) and the Supreme Court (for example, being led by John de Waal QC and David Lewis in ParkingEye v Beavis ' now the leading case on the law of penalty clauses). He also has experience of acting as an expert on English law for proceedings abroad, and welcomes instructions to do so.

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Jurisdiction(s):
United Kingdom
Key definition:
Remedy definition
What does Remedy mean?

The means by which a court enforces a right or orders redress for a wrong. It can include damages (whether compensatory or restitutionary), injunctive relief (whether interim or final) and specific performance (of outstanding obligations).

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